In the Adjustments Columns of the Work Sheet, the Credit

question 97

Multiple Choice

In the Adjustments columns of the work sheet, the credit to the Merchandise Inventory account (using the periodic system) represents

• A) beginning inventory.
• B) ending inventory.
• C) the difference between the beginning and the ending inventory.
• D) the balance owed to creditors for inventory.
• E) net income.

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Definitions:

Supply Elasticity

The measure of responsiveness of the quantity of a good supplied to a change in its price.

Long Run

A period in which all factors of production and costs are variable, allowing firms to adjust all inputs in response to market conditions.

Short Run

A period in economics during which at least one input or resource is fixed, limiting the ability of the firm to adjust all inputs freely.

Market Demand

Represents the total quantity of a good or service that all consumers in a market are willing and able to purchase at various prices over a specific period of time.